Brazil, it seems, simply can’t put its house in order. The real hit R$3 to the US dollar during trading on Wednesday for the first time in more than a decade, after Renan Calheiros, president of the Senate, rejected a presidential decree that would have raised payroll taxes. The measure is seen as essential to meeting ambitious fiscal targets set by Joaquim Levy, the market-friendly finance minister installed in January to rescue the economy, and was the subject of a public rift between Levy and President Dilma Rousseff last weekend.

Failure to meet those targets – or even the fear of failure – puts Brazil’s hard-won investment grade credit rating in jeopardy. Markets were especially jittery on Wednesday, economic daily Valor Econômico reported, as a team from Standard & Poor’s, one of the three global ratings agencies, arrived in Brazil to evaluate the country’s credit risk. Read more

By Zsolt Kuti and Imre Ligeti of the National Bank of Hungary

The upgrades in Hungary’s credit outlook last year, first by Standard & Poor’s and then by Moody’s, represent a turnaround in the history the country’s credit ratings. The earlier, negative trend was halted, and all three major credit rating agencies now assign a stable outlook to Hungarian debt.

We think this presages an upgrade for Hungary. Here is why. Read more

China is no stranger to internet sensations, but a documentary highlighting the scale of the country’s chronic air pollution seems to have shaken the trees all the way to Beijing’s highest branches.

Under the Dome, the 104-minute film made by journalist Chai Jing, has already been seen by 160m people on Tencent’s video page, and garnered praise from government ministers and state media. Investors are also taking note. Read more

** FT News **

* Israel PM warns against Iran nuclear deal | Obama administration reacts angrily to Israeli prime minister’s speech to Congress

* Ukraine sharply raises rates to 30% | Move aims to shore up the plunging currency and temper spiralling inflation Read more

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As Brazil’s monetary policy committee sits down in Brasília the consensus view is that it will attempt to regain some credibility in the fight against inflation and raise its policy interest rate by 50 basis points for a third consecutive time. That would bring its target overnight rate, the Selic, to 12.75 per cent a year. Even after discounting inflation of about 7.5 per cent, that is still a very hefty 5.25 per cent a year. So whatever the Copom announces on Wednesday evening after two days of deliberation – it will be either 50bp or 25bp – it will raise protests from labour unions and others worried about the impact of high interest rates on consumption and jobs.

But policy makers may well feel that, right now, inflation matters more. Read more

** FT News **

* Glencore chief upbeat on oil trading | Forecast of ‘blow out’ year for business if current trend persists

* Thousands pay respects to Boris Nemtsov | Investigators yet to identify any suspects in connection with killing Read more

The strategic rivalry between Japan and China in Asia is finding expression not only in territorial disputes in the east China sea but also in plans for railways to criss-cross Thailand and eventually link the country to a wider Indochina rail network.

Both lines will serve primarily as freight transport systems. The planned Chinese-backed railway will run north-south from Thailand’s main deep seaport in Rayong to the Laos border at Nong Khai, with a separate spur that connects to Bangkok. Read more

** FT News **

* Anti-Maidan movement creates fear in Moscow | Putin critics become targets for groups allied to Kremlin

* Toyota says Russia will stay profitable | Carmaker focuses on mass premium vehicles Read more

The second cut in China’s interest rates in three months reveals key elements in Beijing’s thinking as it tries to reconcile an economic policy agenda beset with conflicting priorities, analysts said on Monday.

The task before China requires some delicate manoeuvres. It aims to wean the country off an extraordinary debt binge (see Martin Wolf ) while keeping GDP growth fairly robust. It hopes to combat disinflationary pressures while preventing the renminbi from sliding too sharply against the US dollar. It wants to curb a dangerous slump in industrial profits without resorting to another round of investment pump-priming. It needs to keep domestic liquidity levels buoyant in spite of a surge in capital flight.  Read more

Mexico’s oil liberalisation is now well under way, with the tender of a second lot of oil assets – nine fields grouped into five blocks – now set to join the 14 that have already been announced. But do the country’s projections for future oil recovery add up?

The government is hoping that private investment in a sector closed for nearly 80 years under the monopoly of state oil company Pemex will succeed in turning around a decade of inexorable decline in Mexico’s oil output. Indeed, it has talked of adding 500,000 barrels per day (bpd) by 2018, when the government’s term is up. Read more

Last week Diezani Alison-Madueke, Nigeria’s oil minister and the president of Opec, called for an extraordinary meeting of the oil exporters’ cartel in the face of falling prices. Rafael Correa, president of Ecuador, Opec’s smallest member, rallied behind her saying prices were “unnecessarily low”.

They may not achieve much – Saudi Arabia and other Gulf exporters are against production cuts – but the calls will nevertheless be welcome in Venezuela, where the sudden collapse of oil prices has been especially bad news. Read more

Another week goes by and the outlook for Brazil’s economy gets gloomier still. The consensus on GDP is now for a 0.58 per cent contraction this year, according to the central bank’s latest weekly survey of market economists, while industrial production is expected to contract by 0.72 per cent. Inflation is expected to rise to 7.47 per cent; the central bank’s policy interest rate is seen ending the year at 13 per cent.

The survey was published on Monday after a weekend that saw yet another apparent rift open up at the top of government, along with some surprising behaviour by President Dilma Rousseff. Read more

** FT News **

* Fridman attacks North Sea deal threat | Billionaire’s fund says government plans to block investment ‘not rational’

* Boris Nemtsov: Last words in FT interview | Edited highlights from discussion with politician Read more

Gulzar Ahmed is one small link in the human bridge between Dharavi, one of India’s largest shanty towns, and the fashion boutiques of Milan.

The master tailor in a small workshop run by Italian designer Viola Parrocchetti, Ahmed is one of thousands of skilled craftsmen that live and work in Dharavi, providing tailoring and embroidering services to India’s thriving fashion industry, much of it destined for export. Read more

** FT News **

* Thousands march in memory of Nemtsov | Critics blame Putin while officials portray killing as attempt to destabilise Russia

* Fridman legal threat over North Sea block | Russian billionaire’s plans run in to fear of more sanctions Read more

By David Clark of the Russia Foundation

For all the attention given to the fighting in Donetsk and Luhansk, it is clear that Ukraine cannot solve its problems by military means alone. If there is a route to national salvation it lies in the field of domestic reform and the quest to find a new model of internal development. It is only by emulating the achievement of neighbouring Poland and becoming a well-governed country with a strong, dynamic economy that Ukraine can hope to escape from its current predicament. As a ‘Slavic tiger’ it could provide a source of attraction strong enough to regain eventual control over the territories it has lost and perhaps even become a catalyst for change in Russia itself. Stuck in a post-Soviet rut of dysfunctional institutions and economic stagnation, it will remain weak and vulnerable to Putin’s policy of divide and rule. Read more

** FT News **

* Ghana reaches $1bn deal with IMF | Ghana’s predicament is seen by analysts as a warning sign for some other countries

* China becomes Volvo’s biggest market | Geely ownership pays off for Swedish carmaker and clears way for further expansion Read more

Turkey FT special report Tayip ErdoganThe Turkish government’s decision last month to ban a metalworkers’ strike on the grounds that it endangered national security is part of an familiar pattern in the country. At least nine other strikes have been similarly stopped since the year 2000.

This time, though, the Turkish government outdid itself in explaining how the labour action could be considered an issue of national security. It said that the strike by Birleşik Metal-İş (United Metal-Work), a union representing just two per cent of Turkey’s million-plus metal workers, would jeopardise production of the Turkish police’s water cannon trucks – the very vehicles that are used to suppress labour unrest and other protests. Read more

By Kevin P. Gallagher and Margaret Myers

Despite the economic slowdown that is gripping Latin America, Chinese finance to the region rose to $22bn in 2014, a 71 per cent jump over 2013. These latest estimates from the China-Latin America Finance Database put 2014 as the second highest year on record for Chinese lending in Latin America and raise the stock of Chinese finance in the region to $119bn since 2005, when China’s banks started reaching out to the Americas.

This new finance couldn’t come at a better time. After a decade-long commodity boom, the International Monetary Fund (IMF) estimates that Latin America’s economic growth may only reach 2.2 per cent in 2015. As the economy cools, the region’s traditional sources of capital are turning to the United States, beckoned by faster growth and rising interest rates. Read more

** FT News **

* Ghana reaches $1bn deal with IMF | Ghana’s predicament is seen by analysts as a warning sign for some other countries

* China becomes Volvo’s biggest market | Geely ownership pays off for Swedish carmaker and clears way for further expansion Read more